If the marginal costs of water pollution abatement is increased, then the optimal amount of water pollution increases.

Question

Quizplus · Accepted Answer

If the marginal costs of water pollution abatement is increased, then the optimal amount of water pollution decreases. This is because as the cost of reducing pollution increases, it becomes less efficient to continue reducing pollution for every unit of cost, and the optimal level of pollution therefore shifts upwards.

If the Marginal Costs of Water Pollution Abatement Is Increased